Angang Steel Co., China’s fourth-largest mill by output, said first-half earnings fell by 73 percent as the market price for steel products in China declined because of oversupply.
Net income was 155 million yuan ($24 million) in the six months ended June, dropping from 577 million yuan a year earlier, the Anshan, Liaoning-based producer said. Sales dropped to 29 billion yuan from 38.2 billion yuan.
“In the first half of 2015, amid the continuous slowdown of domestic growth, there was still an aggravated mismatch between the supply and demand in the iron and steel industry with significant decrease in the market price of steel products,” the company said in a statement to the Hong Kong Stock Exchange after the market closed.
The average price for steel reinforcement-bar tumbled 24 percent in the first six months from a year ago, as mills face overcapacity and slumping demand in China. Net profit at medium-to-large mills in the first half of this year fell 73 percent from a year earlier, according to a China Iron and Steel Association survey of its members.
Angang’s bigger rivals Hebei Iron & Steel Co. and Baoshan Iron & Steel Co., saw gains in first-half profit as a decline in raw material prices countered weaker steel demand. Smaller competitor Maanshan Iron & Steel Co. reported a wider net loss in the first half and said it expects to see a loss for the first nine months of the year.
— With assistance by Feiwen Rong